Painful Backlash As Zimbabwe Government Attempts To Whip Hyperinflation

The Zimbabwean government's offensive against soaring prices has run square into the law of unintended consequences as consumers nationwide face acute shortages of a broad range of essential commodities and manufactured products.

On Thursday, Industry Minister Obert Mpofu, chairman of a cabinet task force formed to whip inflation, ordered businesses to stop selling basic goods in bulk. However, the shelves of many stores across Zimbabwe had by then been emptied as consumers loaded up on goods that retailers were compelled by police to deeply discount.

An informal survey found that leading chain stores including TM Supermarkets, Spar, OK and smaller retail outlets had few goods to sell in the wake of the buying frenzy. Basic products such as bread, meat, cooking oil, salt, sugar and soap were to be found only on the black market where they were going for exorbitant prices.

Late Wednesday the cabinet task force summoned business managers from a range of economic sectors to an emergency meeting to discuss the offensive against price increases. Confederation of Zimbabwe Industries President Callisto Jokonya said that ministers demanded manufacturers maintain production levels. Businesses asked government to provide hard currency and stop slinging the label of "saboteur."

Silas Masiya, a resident of the Harare satellite town of Chitungwiza, told reporter Blessing Zulu of VOA's Studio 7 for Zimbabwe that the jobless have benefited from the onslaught in stores as they were able to queue up to buy goods for resale.

ZimSun Group Chief Executive Officer Shingi Munyeza said tourism firms have been ordered to slash prices but fear the sector will collapse if pricing chaos continues.

Some business owners said they had been forced by police to open their shops after hours to sell the officers large quantities of products at low prices they imposed.

One business man speaking on condition of anonymity said police forced him to open his Harare hardware store and reduce cement prices to Z$150,000 a bag (US$1) from Z$1.3 million. The officers then bought 800 bags of cement, filling the trucks they had brought. Other stores in Harare and Chitungwiza have reported similar incidents.

Human rights lawyer Rangu Nyamurundira told reporter Carole Gombakomba of VOA's Studio 7 for Zimbabwe that such conduct by police represented and abuse of their powers and violated the rights of store owners thus victimized.

Contacted for comment, Zimbabwe Republic Police spokesman Oliver Mandipaka said reports of such activity were false. Contrary to what some business people were told by line officers, Mandipaka said no investigation into the charges had been opened.

Mandipaka said the police would continue to clampdown on profiteering businesses.

The state move to fight inflation by fiat has led business to contemplate staff cutbacks and seek wage cuts from organized labor, said the Commercial Workers Union of Zimbabwe, which represents retail workers.

The Zimbabwe Congress of Trade Unions said representatives of metalworking companies and other manufacturing firms have raised the possibility of reduced wages and retrenchment packages in the face of possible company closures.

Commercial Workers Union President Lucia Matibenga, also first vice president of the ZCTU, told reporter Patience Rusere that job losses are in store just as happened in the wake of the government's seizure of farms under land reform from 2000 on.

Economists and political analysts say “Operation Dzikamai,” or “Stay Calm” as the government has dubbed it, instead of controlling prices seems likely to exacerbate the economic crisis because authorities have not addressed its true causes.

Reporter Ndimyake Mwakalyele of VOA's Studio 7 for Zimbabwe sought perspective from economist Prosper Chitambara of the Labor and Economic Development Research Institute of Zimbabwe, and Pedzisayi Ruhanya, program manager with the Crisis in Zimbabwe Coalition, who said Harare is returning to old tactics.